LK Chem엘케이켐
489500 · KOSDAQ · ₩489500 · 엘케이켐
Valuation model · Discounted cash flow (DCF)
We use a 5-year discounted cash flow: the value of the cash the business is expected to produce, in today's money.
Fair value per share
₩11,167
vs the current price (₩20,250)
- Enterprise value
- ₩57B
- Equity value
- ₩71B
- WACC
- 7.4%
Model estimate based on the assumptions shown. Not a price target and not a buy or sell signal. This is not financial advice.
Why the model and the price differ
The model is 45% away from today's price. A gap this size usually means the market expects something the past figures don't show yet, or the model leaves something out. What we can see:
- To match today's price of ₩20,250, the model needs an operating margin of 50.7% every year (it uses 28.2%).
- Or revenue growth +17.7 points a year higher than assumed in each of the 5 years.
- 36% of the last 12 months' net profit came from outside operations (stakes in other companies, interest, one-offs). The model adds those stakes at book value but doesn't project that income.
Treat the model as a starting point: change the assumptions to the story you believe, and compare with the multiples check below.
Bear / Base / Bull
- Bear
- ₩8,338
- −58.8%
- Base
- ₩11,167
- −44.9%
- Bull
- ₩15,851
- −21.7%
Bear: revenue growth 3 points lower every year, EBIT margin 2 points lower, WACC 1 point higher. Bull: the opposite.
Assumptions
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Cycle options
Margin path
Every year uses the cycle-average margin (28.2%).
Revenue growth
- -10%
How much sales grow that year, compared with the year before.
Default: the last 1 years' revenue growth (-19.4% a year, annual reports), fading to 3% by year 5.
- -6.7%
How much sales grow that year, compared with the year before.
Default: the last 1 years' revenue growth (-19.4% a year, annual reports), fading to 3% by year 5.
- -3.5%
How much sales grow that year, compared with the year before.
Default: the last 1 years' revenue growth (-19.4% a year, annual reports), fading to 3% by year 5.
- -0.2%
How much sales grow that year, compared with the year before.
Default: the last 1 years' revenue growth (-19.4% a year, annual reports), fading to 3% by year 5.
- 3%
How much sales grow that year, compared with the year before.
Default: the last 1 years' revenue growth (-19.4% a year, annual reports), fading to 3% by year 5.
Business
- 28.2%
Operating profit as a share of revenue.
Default: through-the-cycle average of the last 12 months and the last 2 annual reports' operating margins.
- 27.5%
Share of operating profit paid as corporate tax.
Default: Korea's top corporate tax rate (25%) plus 10% local income tax.
- 30.9%
The non-cash cost of wearing out equipment, added back to cash flow (% of revenue).
Default: not in the statements, so 80% of capital spending (most spending replaces equipment that wears out).
- 38.7%
Money spent on factories, equipment, software and other long-term assets (% of revenue).
Default: average of the last 2 annual reports (cash flow statements; equipment and intangibles).
- 40%
Stock and unpaid customer bills, less unpaid supplier bills, as a % of revenue. Each year's extra revenue ties up this much more cash.
Default: working capital (current assets less cash and deposits, minus current liabilities other than borrowings) as a share of revenue, averaged over the last 2 years.
Discount rate
- 2%
How fast cash flows keep growing every year after year 5.
Default: about Korea's long-run inflation plus real growth.
- 4.11%
Yield on Korea's 10-year government bond: the return with almost no risk.
Default: Korea Treasury Bond 10-year yield on 2026-10-28.
- 0.6
How much the share moves when the market moves: 1 means just like the market.
Default: 87 weeks of weekly returns against KOSPI (official index); raw beta 0.31, adjusted toward 1 and kept between 0.6 and 2.0.
- 5.5%
The extra return investors want for owning shares instead of bonds.
Default: a typical premium for Korean shares.
- 5.61%
The interest rate the company would pay to borrow.
Default: the 10-year yield plus a 1.5% credit spread.
Starting point
- Revenue (TTM to H1 2026)
- ₩25B
- Net debt (borrowings and leases − cash and deposits)
- −₩14B
- Shares
- 6,391,238
- Share price
- ₩20,250
- Market cap
- ₩129B
TTM = trailing 12 months: the last four reported quarters added together. "TTM to H1 2026" is the 12 months up to the latest quarterly or half-year report (H1 = to the end of June). Year 1 grows from there.
Past years and projection
Grey columns are reported results from the annual reports (after-tax EBIT at the model's tax rate), so you can check the growth and margin assumptions against the past. Years 1–5 are the model.
| FY2024 | FY2025 | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|---|---|
| Revenue | ₩25B | ₩20B | ₩22B | ₩21B | ₩20B | ₩20B | ₩21B |
| Growth | — | −19.4% | −10.0% | −6.7% | −3.5% | −0.2% | 3.0% |
| EBIT | ₩10B | ₩4.6B | ₩6.3B | ₩5.9B | ₩5.7B | ₩5.6B | ₩5.8B |
| EBIT margin | 40.5% | 22.6% | 28.2% | 28.2% | 28.2% | 28.2% | 28.2% |
| After-tax EBIT | ₩7.3B | ₩3.3B | ₩4.6B | ₩4.2B | ₩4.1B | ₩4.1B | ₩4.2B |
| + Depreciation | — | — | ₩6.9B | ₩6.4B | ₩6.2B | ₩6.2B | ₩6.4B |
| − Capital spending | ₩7B | ₩10B | ₩8.6B | ₩8B | ₩7.8B | ₩7.7B | ₩8B |
| − Working capital | — | ₩9.5B | −₩990M | −₩597M | −₩291M | −₩16M | ₩240M |
| Free cash flow | — | — | ₩3.8B | ₩3.2B | ₩2.8B | ₩2.5B | ₩2.4B |
| Discount factor | — | — | 0.931 | 0.867 | 0.807 | 0.751 | 0.700 |
| Present value | — | — | ₩3.5B | ₩2.8B | ₩2.3B | ₩1.9B | ₩1.7B |
Terminal value ₩64B, worth ₩45B today: 79% of enterprise value. It assumes spending settles at 110% of depreciation once growth slows to the terminal rate.
Sensitivity
Fair value per share as two inputs change; the middle is the current case.
| WACC ↓ · Terminal growth → | 1.0% | 1.5% | 2.0% | 2.5% | 3.0% |
|---|---|---|---|---|---|
| 6.4% | ₩11,656 | ₩12,362 | ₩13,226 | ₩14,311 | ₩15,713 |
| 6.9% | ₩10,839 | ₩11,408 | ₩12,091 | ₩12,929 | ₩13,979 |
| 7.4% | ₩10,151 | ₩10,616 | ₩11,167 | ₩11,828 | ₩12,639 |
| 7.9% | ₩9,563 | ₩9,949 | ₩10,399 | ₩10,932 | ₩11,573 |
| 8.4% | ₩9,056 | ₩9,379 | ₩9,753 | ₩10,188 | ₩10,704 |
Now (TTM)
- Market cap
- ₩129B
- Enterprise value
- ₩115B
- P/E
- 21.3×
- P/B
- 2.0×
- P/S
- 5.2×
- EV/EBITDA
- —
- Dividend yield
- 0.0%
Over time (at each year end)
| 2025 | |
|---|---|
| Price | ₩36,300 |
| Market cap | ₩232B |
| P/E | 53.3× |
| P/B | 3.9× |
| P/S | 11.5× |
| EV/EBITDA | — |
| Dividend yield | 0.0% |
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Versus similar companies
| Company | P/E | P/B | P/S | EV/EBITDA | Dividend yield |
|---|---|---|---|---|---|
| LK Chem | 21.3× | 2.0× | 5.2× | — | 0.0% |
| LG Chem | — | 0.5× | 0.3× | — | 0.9% |
| Hanwha Solutions | — | 0.6× | 0.4× | — | 0.0% |
| Hanwha | 6.2× | 0.4× | 0.1× | — | 1.4% |
| SKC | — | 2.1× | 2.0× | — | 0.0% |
| KCC | 0.9× | 0.3× | 0.5× | 8.7× | 0.0% |
| Kumho Petro Chemical | 5.2× | 0.4× | 0.4× | — | 1.6% |
| Similar companies (median) | 5.2× | 0.4× | 0.4× | 8.7× | 0.4% |
Calculated from end-of-day prices and filed financial statements. Not a recommendation. This is not financial advice.
Also known as: LK Chem / 엘케이켐 / 489500 / KRX:489500
Source: KRX statistical information